updated 12:30 pm EDT, Tue September 26, 2006

Scandinavian iTunes talks

Negotiations between Apple and Scandinavian governments over iTunes restrictions have made "surprising progress," according to Norway's official consumer advocate. "Our meeting was much more constructive than I expected it would be," said Bjorn Erik Thon, director of the Norwegian Consumer Ombudsman's office. "We argued and did not agree on a lot, but we discussed all issues." A final resolution to the dispute may require Apple to change its iTunes business model in Norway as well as several other Scandinavian countries, according to the International Herald Tribune. Representatives from Sweden, Denmark, and Finland attended the meeting, all of which have laws similar to Norway to protect consumers, and all have agreed to follow Norway's lead.

iTunes and Scandinavian representatives argued over iTunes interoperability, Apple's refusal to accept liability for possible damages to a computer caused by iTunes software, Apple's ability to change contract terms after customers purchase a song, and the Cupertino-based company's assertion that English law can apply to purchases in Norway, according to Thon.

"It would be inappropriate to discuss the exact areas where progress was made, but it was a positive and good dialogue," Thon said, noting that he has not ruled out possible fines for Apple. "We prefer to find a solution through discussions, but we still have the possibility of bringing the case before the market council."

The Consumer Council of Norway initially filed a complaint against Apple in late January, saying that the iTunes terms of service violates basic contract law. The British Phonographic Institute also asked Apple in early June to make its iTunes DRM compatible with other music players, just one day after the Norway consumer advocate group won a preliminary ruling on the issue. European competition officials said they are wary of proposals to force Apple into making iTunes compatible with rival players, saying they wanted to wait for further market developments.

Consumer-rights protection agencies in all three countries extended Apple's deadline in mid-June, offering the company more time to respond to their concerns over its iTunes terms of service. Apple refuted criticism that its iTunes software is illegal in a letter which was made public with large portions censored out, because the document allegedly contained industrial secrets. As late as August 15th Norway's consumer regulators scheduled to meet in Iceland to discuss possible legal action against Apple if the company refuses to lift its disputed iTunes restrictions.